The US financial services sector could be forced to reimburse the US government for any losses on its $700bn rescue plan under a breakthrough agreement that paves the way for congressional approval as early as Monday.

After a weekend of frenzied talks, Hank Paulson, the Treasury secretary, and Nancy Pelosi, the Democratic House speaker, announced early on Sunday that a tentative deal had been reached authorising the government to buy up to $700bn of troubled assets from financial institutions.

If I were designing this project, I would have required the Treasury (1) to document how it valued the major assets it purchased and (2) to retain the documentation for at least five years. The documentation would facilitate oversight by Congress and the Government Accountability Office. In so doing, it would help constrain overly sweet deals and other forms of favoritism.
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But what kind of accountability might we get from the bill’s declaration of congressional purposes?

The purposes section is (as often happens) a mishmash of potentially conflicting objectives. The summary describes section 103 as requiring the Treasury to consider “the interests of taxpayers, minimizing the impact on the national debt, providing stability to the financial markets, preserving homeownership, the needs of all financial institutions regardless of size or other characteristics, and the needs of local communities.”

You can find something here to justify (or criticize) whatever you want. Not much accountability in that.

At least the Treasury doesn’t have to consider “empowering and enhancing the self-esteem of any and all Americans in communities nationwide.”